It has been about a month since the last earnings report for Norwegian Cruise Line (NCLH - Free Report) . Shares have lost about 3.4% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Norwegian Cruise Line due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Norwegian Cruise Line's Q3 Earnings & Revenues Top Estimates
The company’s earnings (excluding 16 cents from non-recurring items) of $2.27 per share outpaced the Zacks Consensus Estimate of $2.21. The bottom line also increased 22% on a year-over-year basis. Higher revenues aided the quarterly results.
Revenues came in at $1,858.36 million, which surpassed the Zacks Consensus Estimate of $1,838.3 million and improved 12.5% on a year-over-year basis. The upside was driven by an 11.9% increase in passenger ticket revenues to $1,334.46 million. The same from onboard and other sources was up approximately 14% on a year-over-year basis to $523.9 million. Gross yield (total revenue per Capacity Day) increased 4.5% in the quarter on a year-over-year basis.
Net yield grew 4% on a constant-currency basis. The measure was up 3.9% on a reported basis. Fuel price per metric ton (net of hedges) increased 7.1% to $510 in the quarter under review. Total cruise operating expenses were up 10.8% to $928.94 million due to a 7.6% rise in Capacity Days.
Also, marketing, general and administrative expenses rose 16.4% year over year to $235.44 million. Gross Cruise Costs (sum of cruise operating expenses and marketing, general and administrative cost) per Capacity Day increased 4% in the third quarter due to higher marketing, general and administrative expenses. The company repurchased shares worth more than $450 million in the first nine months of the year.
Q4 & 2018 Guidance
Norwegian Cruise Line expects earnings per share (excluding special items) of approximately 78 cents in the fourth quarter of 2018. For 2018, the company anticipates earnings per share (excluding special items) to be $4.85 (earlier forecast: $4.70-$4.80).
Fuel price per metric ton, net of hedges, is projected at $484 and $480 for the fourth quarter and 2018, respectively.
How Have Estimates Been Moving Since Then?
Fresh estimates followed a downward path over the past two months.
VGM Scores
At this time, Norwegian Cruise Line has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Norwegian Cruise Line has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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It has been about a month since the last earnings report for Norwegian Cruise Line (NCLH - Free Report) . Shares have lost about 3.4% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Norwegian Cruise Line due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Norwegian Cruise Line's Q3 Earnings & Revenues Top Estimates
The company’s earnings (excluding 16 cents from non-recurring items) of $2.27 per share outpaced the Zacks Consensus Estimate of $2.21. The bottom line also increased 22% on a year-over-year basis. Higher revenues aided the quarterly results.
Revenues came in at $1,858.36 million, which surpassed the Zacks Consensus Estimate of $1,838.3 million and improved 12.5% on a year-over-year basis. The upside was driven by an 11.9% increase in passenger ticket revenues to $1,334.46 million. The same from onboard and other sources was up approximately 14% on a year-over-year basis to $523.9 million. Gross yield (total revenue per Capacity Day) increased 4.5% in the quarter on a year-over-year basis.
Net yield grew 4% on a constant-currency basis. The measure was up 3.9% on a reported basis. Fuel price per metric ton (net of hedges) increased 7.1% to $510 in the quarter under review. Total cruise operating expenses were up 10.8% to $928.94 million due to a 7.6% rise in Capacity Days.
Also, marketing, general and administrative expenses rose 16.4% year over year to $235.44 million. Gross Cruise Costs (sum of cruise operating expenses and marketing, general and administrative cost) per Capacity Day increased 4% in the third quarter due to higher marketing, general and administrative expenses. The company repurchased shares worth more than $450 million in the first nine months of the year.
Q4 & 2018 Guidance
Norwegian Cruise Line expects earnings per share (excluding special items) of approximately 78 cents in the fourth quarter of 2018. For 2018, the company anticipates earnings per share (excluding special items) to be $4.85 (earlier forecast: $4.70-$4.80).
Fuel price per metric ton, net of hedges, is projected at $484 and $480 for the fourth quarter and 2018, respectively.
How Have Estimates Been Moving Since Then?
Fresh estimates followed a downward path over the past two months.
VGM Scores
At this time, Norwegian Cruise Line has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Norwegian Cruise Line has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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